TRENTON, N.J. – Governor Phil Murphy’s reckless borrowing has earned New Jersey another credit downgrade, one which could increase the overall cost of selling $4.3 billion in bonds later in November.
On Friday, S&P Global Ratings dropped the Garden State’s general obligation bond rating to BBB+ from A-; the state’s underlying rating fell to BBB from BBB+.
“The downgrade reflects our view that New Jersey will continue to have a significant structural deficit that will be difficult to close in the coming years because of decreased revenues as a result of the COVID-19 pandemic, combined with high and increasing debt, pension, and other postemployment benefit liabilities,” explained S&P analyst David Hitchcock said in released statement.
Governor Murphy’s $4 billion borrowing plan was accompanied by significant budget cuts or a firm mathematical basis to support the need for the extra dollars which, over time, will cost taxpayers significantly more due to the costs associated with borrowing.
New Jersey already has the nation’s 4th highest “tax-supported per-capita debt.”
This is New Jersey’s second downgrade since March 2020.